What is a consensus expectation?

"Consensus forecast" is the average expectation of a series of analysts or research agencies. In this process, the individual analyses, for example, expectations regarding earnings per share, are added together and averaged.

There are specialised information providers and research agencies, such as Consensus Economics and Zacks Investment Research, which offer such bundled analyses. Websites such as Belegger.nl also offer these consensus forecasts. Sometimes, listed companies themselves ask analysts to perform a consensus estimate.

The consensus forecast gives investors an idea of what the market thinks about the future performance of a company and can serve as a reference point for investment decisions.